Showing posts with label economic forecaster. Show all posts
Showing posts with label economic forecaster. Show all posts

Saturday, April 18, 2020

Georgia’s labor market tells a tale of two surveys in the 1st quarter of 2020


Georgia Unemployment Rate, 2018-March 2020, seasonally adjusted
Georgia posted meager 1st quarter employment growth but not due to the coronavirus based on a survey of establishments in the state, while the household survey showed definite signs of the impact of the coronavirus on labor activity.

The State of Georgia gained 5,000 jobs in the 1st quarter of 2020, an 85% decline from its job gains in the 1st quarter of 2019 according to the survey of businesses and government agencies.

At the same time, the state’s unemployment rate remained at 3.1% in January and February before jumping to 4.2% in March a rate not seen in the state since 2018.

The Georgia governor’s “stay-at-home” order was not effective until April 3rd, so the small job gains must be attributed to a general slowing of the state’s economy rather than to the effects of the state’s order.

It is possible that some people were curtailing their economic activities even before the order became official resulting in a slowdown and layoffs, which may account for the increase in the number of unemployed reported in the household survey.

Establishment survey

All three months (January, February, and March) showed smaller results than for the same months a year ago.

The Atlanta metro area gained 2,200 jobs over the quarter that includes a 500 job gain in the month of March. The 1st quarter gain represents a 92% decline from the 1st quarter of 2019 when the area recorded increases of more than 27,000 jobs.

The other 12 metro areas in the state combined to a net loss of 900 jobs in the 1st quarter compared to a gain of 3,000 in the 1st quarter of 2019.

The trend in the numbers along with the fact that the Atlanta area posted a job increase in March despite illnesses associated with Covid-19 in the metro area indicates that the survey of businesses and government agencies did not reflect any effects from the coronavirus in the establishment survey.

Establishment survey by industry

Health care and social assistance posted a 6,000 job increase over the quarter, slightly below the 6,500 job gain in the 1st quarter of 2019.

The increase was partially offset by a 1,700-job loss in the leisure and hospitality sector and a 1,300-job loss in manufacturing. Professional and business services remains the largest sector in the state despite having a net loss of 200 jobs over the quarter.

Establishment survey by area

After Atlanta, the Augusta area posted the next highest job gain among the state’s metro areas, adding 900 jobs in the 1st quarter of 2020.

Areas posting significant job losses included Valdosta (-900), Dalton (-700), and Athens (-700).

Employment/unemployment

In contrast to the establishment survey that serves as the basis for the jobs data, the household survey told a very different story for the first quarter of the year.

In March, the number of unemployed in the state rose by 55,442 to a total of 216,589 people as compared to 187,625 in March 2019.

The number of employed persons dropped by 77,876 people according to the household survey, with a net loss 22,434 people listed as dropping out of the labor force.

As a result, the labor force participation rate declined to 62.1%.

Effects of the coronavirus on Georgia’s labor market

The state was relatively slow in implementing procedures to mitigate the effects of the coronavirus, which explains the small effect on 1st quarter job growth.

For example, the arts, entertainment, and recreation sector, which is expected to experience a steep decline in employment due to the closing of many nonessential activities during the stay-at-home period, showed an employment increase of 1,500 jobs in the 1st quarter including a 400 job rise in the month of March.

It is expected that when the April establishment employment numbers are reported most of the industries and areas in the state will show significant declines compared to the 1st quarter of the year, and the state’s unemployment rate will continue to climb.

Whether these employment declines continue through the 2nd quarter depends on both how long the state’s stay-at-home order remains in place, and how confident people feel about returning to their normal activities.

Friday, August 28, 2015

GSU Economist sees improved job growth for Georgia and Atlanta area

In his “Forecast of Georgia and Atlanta,” released Aug. 27, Rajeev Dhawan of the Economic Forecasting Center at Georgia State University’s J. Mack Robinson College of Business believes that the state’s decelerating job growth will reverse in the second half of 2015.

“As global economic health stabilizes, consumers demonstrate a greater propensity to spend and corporate spending resumes, Peach State job growth will accelerate to 2.6 percent for the 2015 calendar year,” Dhawan said.

The corporate sector is faring well in Georgia and Atlanta. Statewide, the sector posted a 7.2 percent gain in the second quarter, “pointing to momentum moving forward,” the forecaster said. Furthermore, the move of several headquarters to Atlanta continues to result in professional and business services hiring.

“Although this sector is enduring weaker global growth, domestic consumption is taking up any shortfalls,” Dhawan said.

The forecaster is predicting that Georgia employment will gain
·       82,900 jobs in calendar year 2015
·       87,500 jobs in 2016
·       94,100 jobs in 2017

This would mean slower growth than in the past two years. As a comparison using seasonally adjusted data, in 2013, the state added 95,500 jobs and in 2014 increased by an additional 146,500 jobs. 

Over the 12 months ending in July, the state has added 89,400 jobs (seasonally adjusted) as rapid growth in the first 6 months was followed by a marked slowdown in the most recent 6-month period.

For the Atlanta metro area, Dr. Dhawan see the addition of
·       62,400 jobs in calendar year 2015
·       63,300 jobs in 2016
·       65,500 jobs in 2017

In 2013, the Atlanta metro area added 77,600 jobs and in 2014 added 97,200 jobs.

Dhawan said millennials, who constituted 23.6 percent of metro Atlanta’s population in the 2010 census, are making their influence felt in several regards.


“To no one’s surprise,” he said, “millennials are fueling demand for multi-family housing. They’re also spurring area companies to relocate to downtown and Midtown in order to draw on their high-tech skills.”

“I expect the area’s information sector to continue to expand in coming years as it benefits from a robust fiber optic infrastructure, relatively low-cost electricity generation and a reliable power grid,” Dhawan said.

Attracting young, technologically savvy talent is one of the reasons that healthcare added almost 3,500 jobs in the first half of 2015. For the full year, this sector will add 8,100 jobs.

Although growth in the metro area’s hospitality and transportation sectors slowed somewhat in the first half of the year, both will benefit from the spillover of domestic demand growth in catalyst sectors (corporate, healthcare, technology and manufacturing) for a combined total of 12,800 jobs in 2015.